Invoice Processing Glossary
Plain-English definitions of terms used in invoice processing, accounts payable, and bookkeeping automation.
Invoice Data Extraction
The process of automatically identifying and pulling structured data fields from invoice documents.
Optical Character Recognition (OCR)
Technology that converts images of text into machine-readable characters.
Accounts Payable Automation
Using software to automate the capture, coding, approval, and payment of vendor invoices.
Purchase Order (PO)
A buyer-issued document authorizing a purchase from a supplier, often referenced on invoices for 3-way matching.
Three-Way Matching
The AP control process of matching a purchase order, receiving report, and vendor invoice before approving payment.
Vendor Bill
An invoice received from a supplier, recorded in accounts payable as an amount owed.
Invoice
A document issued by a seller to a buyer listing goods or services provided and the amount owed.
Chart of Accounts
A structured list of all financial accounts used by a business to record transactions, organized by type.
General Ledger
The master record of all financial transactions in a business, organized by account.
Accounts Receivable (AR)
Money owed to a business by customers for goods or services already delivered but not yet paid.
Payment Terms
Conditions specifying when and how a buyer must pay a vendor invoice — such as Net 30 or 2/10 Net 30.
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